Approval of Resolution Plan- MP Promoters Private Limited

ORDER The present I.A. No. 03 of 2024 has been preferred by Mr. Durga Das Agarwal, Resolution Professional qua MP Promoters Pvt. Ltd. (hereinafter referred to as the ‘Applicant/RP’) under Section 30(6) of IBC, 2016, seeking the following reliefs: a. Pass an order for approval of the Resolution Plan submitted by the Successful Resolution Applicant for the CIRP of the Corporate Debtor as referred under section 31 of the Code;

b. Declare that upon approval of the Resolution Plan by this Hon’ble Adjudicating Authority, the provisions of the Resolution Plan shall be binding on the Corporate Debtor, its creditors, guarantors, members, employees and other stakeholders involved in the resolution plan in accordance with Section 31 (1) of the Code, and shall be given effect to and implemented pursuant to the order of this Hon’ble Adjudicating Authority;

c. Discharge the Resolution Professional & pass such order(s) as may be deemed fit and proper in the facts and circumstances of the instant case.

d. Pass the directions for constitution of monitoring committee and allow the Applicant to consequently, upon successful implementation of the resolution plan to file a final implementation report and seek discharge.

e. Pass an order to allow successful resolution applicant to change the directors by filing necessary application with ROC after the successful implementation of Resolution Plan and f. Pass such other orders as this Hon’ble Adjudicating Authority may deem fit and proper in the interest of justice.

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

2. Preliminary

2.1. To put the facts concisely, the underlying main petition C.P.(IB)- 03/(PB)/2019 was filed by Ambrane India Private Limited (hereinafter referred to as the “Financial Creditor”) against MP Promoters Pvt. Ltd. (hereinafter referred to as the “Corporate Debtor”) under Section 7 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the “Code”) which was admitted vide Order dated 06.04.2022, of the Principal Bench of this Adjudicating Authority. Consequently, the Corporate Insolvency Resolution Process (hereinafter referred to as “CIRP”) in respect of the Corporate Debtor was initiated and Mr. Durga Das Agrawal was appointed as the Interim Resolution Professional (IRP).

2.2. Subsequently, the Committee of Creditors (CoC) resolved to appoint the IRP as Resolution Professional (RP) in the 1st CoC meeting convened on 16.05.2022 and the same was confirmed by this Adjudicating Authority.

3.Collation of claims by RP

3.1. It is stated by the Applicant that in terms of Regulation 6(1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, the Applicant made a Public Announcement in Form-A on 13.04.2022 to invite claims from creditors of the Corporate Debtor. The Applicant further stated that after due verification of the claims received, the list of creditors was prepared.

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

3.2. It is further stated by the Applicant that after collating the claims, a Committee of Creditors (CoC) was constituted in terms of Section 21(1) of the Code. Thus, the final list of claim by the Applicant is reproduced herein below:

Sl.No Name of the Amount Amount Voting% Financial Creditor Claimed Admitted 1. Ambrane India 1,53,48,297 /- 1,53,48,297 /- 100% Private Limited

3.3. The RP has got the assets of the Corporate Debtor valued under the relevant rules and the Fair Value and Liquidation Value are as under:

Sl. Name of Fair Value Liquidation Average No. valuer Value Fair Value Liquidation Value A. Securities & Financial Assets (SFA)

1. Mr. Devinder 2,46,70,561 1,48,10,793 2,50,84,316 1,53,06,243 Arora 2. Mr. Manoj 2,54,98,070 1,58,01,693 Kumar Total 2,50,84,316 1,53,06,243

3.4. The details of the meetings of CoC as stated in the Application reads as follows:

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

Particulars Date of Main Agenda of Important decisions CoC discussion ratified Meeting

1st CoC 16.05.2022 1. To take note on the list of 1. COC has Ratify the Meeting claimed received by IRP & expenses incurred by COC Constitution the IRP; 2. Appoint the IRP as RP and ratified its fees. 2nd CoC 24.08.2022 1. To take note of the steps 1. COC ratified the Meeting taken by the RP. expenses incurred by the RP; 2.To take note of the Appeal filed by the Suspended 2. COC ratified the Board of Directors. appointment of Legal Counsel. 3.To take note of Application filed under section 19(2) of IBC, 2016. 4.Consider the Appointment of Registered Valuer and preparation of IM & publication of expression of interest.

3rd CoC 03.10.2022 1. To take note on the step 1. Extension of CIRP Meeting taken by the RP; period for 90 days; 2.To take note of the Appeal 2. Appointment of filed by the Suspended Accountant; Board of Directors and its status; 3. Appointment of Registered Valuer; 3.To take note on Application filed under 4. Formation of opinion Section 19(2) of IBC, 2016 under section 43,45,50& and its status 66 of IBC, 2016; 5. COC ratified by the expenses incurred by the RP.

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

4th CoC 06.01.2023 1. To take note on the step 1.Consider and ratified Meeting taken by the RP; the extension of CIRP period for 60 days; 2.To take note of the Appeal filed by the Suspended 2.Ratified by the Board of Directors and its Appointment of status; Forensic Auditor; 3.To take note on Application 3.Ratified the filed under section 19(2) of Appointment of IBC, 2016 and its status; registered valuer; 4.Ratified by the 4. To consider preparation of expenses incurred by IM and publication of the RP. expression of interest

5th CoC 06.03.2023 1. To take note on the step 1. To consider filing of Meeting taken by the RP; application under Rule 11; 2.To take note of the Appeal filed by the Suspended of NCLT Rules, 2016 for Board of Directors and its extension of CIRP; status. 2. To consider various 3.To take note on documents of the Application filed under process i.e RFRP, section 19(2) of IBC, 2016 Eligibility Criteria, and its status; Evaluation Matrix etc.; 4. To take note on the 3. To ratify the expenses status of Forensic Audit incurred by the RP; Report; 4. To discuss about the 5. To consider the contribution to be made preparation of Financial by the COC member Statement as at 31.03.2022 fund the bank account and audit thereof. of the Corporate Debtor; 5. To consider and discuss filing an application under the provisions of Section 33 of IBC, 2016.

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

6th CoC 03.06.2023 1.To take note of the steps 1. To consider filing of Meeting taken by Resolution Application under Rule Professional since 11 of the NCLT Rules, commencement of CIRP; 2016 for further Extension of the CIRP 2. To take note of the Appeal period of 60 days from filed by Mr. Mukesh Kumar, 07.06.2023 to the suspended Director of 05.08.2023; CD before Hon’ble NCLAT. 2. To open/unsealed the 3.To take note of the Resolution Plan received extension allowed under from Prospective Rule 11 of NCLT Rules for Resolution Applicant; CIRP for 90 days; 3. To ratify the expenses 4.To take note of Forensic incurred by the RP. Report and filing of the applications u/s 43,45,50 4.To discuss about the and 66 along with avoidance contribution to be made transactions application; by the COC member to 5. To take note of the deposit fund in the Bank pending matters/cases Account of CIRP. before various 5. To Appoint legal forums/courts. consultant for legal vetting of Resolution Plan and Due Diligence under Section 29A of Insolvency and Bankruptcy Code, 2016 of the Prospective Resolution Applicant.

7th CoC 04.07.2023 1.To take note of the steps 1. To consider the Meeting taken by Resolution resolution plan received Professional since from the Resolution commencement of CIRP. Applicant. 2. To take note of the Appeal 2. To ratify the expenses filed by Mr. Mukesh Kumar, incurred by the RP. the suspended Director of CD before Hon’ble NCLAT. 3. To discuss about the contribution to be made 3.To take note of the by the COC member to extension application filed deposit fund in the Bank under Rule 11 of NCLT Account of CIRP Rules for CIRP for IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

60 days. 4. To take note of Forensic Report and filing of the applications u/s 43,45,50 and 66 along with avoidance transaction applications. 5.To take note of the pending matters/cases before various forums/courts.

8th CoC 22.07.2023 1.To take note of the steps 1. To ratify the expenses Meeting taken by Resolution incurred by the RP. Professional since commencement of CIRP. 2.To discuss about the contribution to be made 2.To take note of the Appeal by the COC member to filed by Mr. Mukesh deposit fund in the Bank Kumar,the suspended Account of CIRP. Director of CD before Hon’ble NCLAT. 3. To take note of Forensic Report and filing of the applications u/s 43,45,50 and 66 along with avoidance transactions application. 4.To take note of valuation of Assets viz Land & Building, Plant & Machinery and Securities and Financial Assets. 5.To take note of the preparation and finalization of Financial Statements as at 31.03.2022 and audit thereof. 6.To take note of the pending matters/cases before various IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

forums/courts. 7.To consider the resolution plan received from the Resolution Applicant.

9th CoC 04.08.2023 1.To take note of the steps 1.To approve the Meeting taken by Resolution Resolution Plan Professional since submitted by Bliss Equity commencement of CIRP. Private Limited (Resolution 2.To take note of the Appeal Applicant). filed by Mr. Mukesh Kumar, the suspended Director of 2.To approve the CD before Hon’ble NCLAT. Liquidation of the Corporate Debtor under 3. To take note of Forensic the provisions of Section Report and filing of the 33 of Insolvency and applications u/s 43,45,50 Bankruptcy Code, and 66 along with avoidance 2016. transactions application. OTHER AGENDA ON 4.To take note of valuation THE COC of Assets viz Land & RECOMMENDATION Building, Plant & Machinery and Securities and Item no. 19A: To Seek Financial Assets. Extension Of CIRP Period For Further 90 5.To take note of the Days From The Hon’ble preparation and finalization Adjudicating Authority. of Financial Statements as at 31.03.2022 and audit Item no. 19B: To thereof. Republish the Expression 6.To take note of the of Interest in Form G. pending matters/cases before various forums/courts. 7.To consider the resolution plan received from the Resolution Applicant.

10th CoC 30.09.2023 1.To take note of the steps 1.To ratify the expenses IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

Meeting taken by Resolution incurred by the RP. Professional since commencement of CIRP. 2.To discuss about the contribution to be made 2.To take note of the Appeal by the COC member to filed by Mr. Mukesh Kumar, deposit fund in the Bank the suspended Director of Account of CIRP. CD before Hon’ble NCLAT and thereafter to Hon’ble Supreme Court. 3.To take note of Forensic Report and application filed u/s 43,45 and 66 along with Forensic Report. 4.To take note of the pending matters/cases before various forums/courts. 5. To take note on republication of FORM G and Final List of Prospective Resolution Applicants. 6. To discuss the matter pending before the Hon’ble Tis Hazari Court.

11th CoC Originally 1.To take note of the steps 1.To ratify the expenses Meeting called on taken by Resolution incurred by the RP. 21.10.2023 Professional since, commencement of CIRP. 2.To discuss about the However contribution to be made deferred to 2.To take note of the Appeal by the COC member to 27.10.2023 filed by Mr. Mukesh Kumar, deposit fund in the the suspended Director of Bank Account of CIRP. CD before Hon’ble NCLAT and thereafter to Hon’ble 3. To discuss and Supreme Court. approve the Settlement Proposal received from 3. To take note on the Letter the Suspended Board of sent to Sub Registrar in Directors of the IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

relation to the Properties of Corporate Debtor. Ethnic Realtors Private Limited. 4.To approve the resolution for seeking 4.To take note of Forensic exclusion of CIRP Period Report and application filed before the Hon’ble u/s 43,45 and 66 along with NCLT. Forensic Report. 5.To approve the 5.To take note of the details Appointment of of the inventories sought Consultant for Vetting from the Suspended Board of Resolution Plan and of Directors. Due Diligence under Section 29A of IBC, 6.To take note of the 2016 pending matters/cases before various forums/courts. 7. To take note of the documents received with respect to the Corporate Guarantee given by the Corporate Debtor. 8. To open the Resolution Plan received pursuant to the republication of FORM G.

12th CoC 12.12.2023 1.To take note of the steps 1. To approve the Meeting taken by Resolution Resolution Plan Professional since submitted by Bliss commencement of CIRP. Equity Private Limited (PRA). 2. To take note of Forensic Report and application filed 2.To approve the u/s 43,45 and 66 along with Resolution Plan Forensic Report. submitted by Mr. Varun Chopra (PRA). 3.To take note of the pending matters/cases 3. To approve the before various Liquidation of the forums/courts. Corporate Debtor under the provisions of Section 4.To take note on the claim 33 of Insolvency and IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

filed by Mr. Nitin Rekhan. Bankruptcy Code, 2016. 5.To consider the resolution plans received from the Resolution Applicants in presence of respective Resolution Applicant.

4. Evaluation and voting 4.1. The Applicant further stated that in compliance of Regulation 36A(1) of CIRP Regulations, 2016, ‘Form-G’ was published by the Applicant on 15.03.2023 and republished on 26.08.2023, thereby inviting Prospective Resolution Applicants (PRAs) to submit their Expression of Interest (EOI). The Applicant submits that subsequently, the applicant received six EOIS from the following PRAs:

Sl.No. Prospective Resolution Applicants

1. Aspect Global Ventures Private Limited 2. Bliss Equity Private Limited 3. Galactico Corporate Service Limited 4. Mr. Komal Madan 5. Mr. Parmeet Lamba 6. Mr. Varun Chopra

4.2. Subsequently, it is submitted that out of the 6 PRAs, two PRAs has submitted their Resolution Plan viz Mr. Varun Chopra & Bliss Equity Private Limited which were opened before the Committee of Creditors and in presence IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

of concerned Prospective Resolution Applicants in the 11th Meeting of the Committee of Creditors held on 27.10.2023.

4.3. It is further submitted that in the 9th meeting of COC held on 04.08.2023 it was resolved to extend the CIRP period by 90 days.Accordingly, I.A. No. 4374/2023 was moved by the applicant before this Tribunal for the aforesaid extension, and the same was allowed vide order dated 21.08.2023.

4.4. The Applicant has further stated that with the approval of the Committee of Creditors, the applicant appointed an independent legal consultant namely Mr. Rajeev Lochan for conducting a legal vetting of Resolution Plan so that the Resolution Plan submitted by the Prospective Resolution Applicants are complied in accordance with the provisions of Insolvency and Bankruptcy Code, 2016.

4.5. After due discussions and deliberations, in the 12th meeting of Committee of Creditors which was held on 12.12.2023, the agenda for approval of Resolution Plan was placed and after detailed discussion, the Resolution Plans submitted by the Resolution Applicant i.e. Mr. Varun Chopra was unanimously approved with 100% voting share by the CoC. The voting result of the successful Resolution Applicant is extracted below:

“ITEM 12: TO CONSIDER FOR APPROVAL OF THE RESOLUTION PLAN SUBMITTED BY MR. VARUN CHOPRA (PRA).

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

The Certificate of Resolution Professional and legal vetting report of Independent Consultant on the Resolution Plan was placed before the Member of Committee of Creditors. After final review of Resolution Plan, discussions, negotiation with Mr. Varun Chopra and deliberations, and comparing evaluation matrix in agenda item no 10 in detail, the plan was put for voting for approval of members in terms of the Section 30 read with Regulation 39 of the CIRP Regulations 2016. Proposed Resolution To consider and if found fit, to pass with or without modification (s) the following Resolution:

“RESOLVED THAT in pursuant to Section 30(3) of the Insolvency and Bankruptcy Code 2016 read with Regulation 39(2)& (3) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, the consent of the members of the COC be and is hereby accorded to approve the Final Resolution Plan submitted by Mr. Varun Chopra” RESOLVED FURTHER THAT in terms of Sub Section 4 of Section 30 of Insolvency and Bankruptcy Code, 2016 the committee of creditors has considered the feasibility and viability of the Resolution Plan submitted by the Resolution Applicant. “RESOLVED FURTHER THAT pursuant to the provisions of Section 30(6) and other applicable provisions of the Insolvency and Bankruptcy Code, 2016 and Rules and Regulations framed there under, the Resolution Professional be and is hereby authorized to submit the Resolution Plan as approved by the Committee of Creditors to the Hon’ble Adjudicating

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

Authority and to do all such acts, deeds and things as may be required or considered necessary or incidental thereto.”

The aforesaid resolution was put to vote and the results of the same was as under:

VOTE IN FAVOR: 100% VOTE AGAINST: 0%

The COC with 100 % of majority passed this present resolution.” 5. Details of Resolution Plan

5.1. The brief outlines of the Resolution Plan as mentioned by the Applicant are extracted herein below for ease of reference: The Financial Outlay as proposed under the Resolution Plan is as follows:.

a) Financial Creditors (Unsecured):- The total claim filed by the Financial Creditor i.e.Ambrane India Private Limited in respect of the Corporate Debtor is to the tune of Rs. 1,53,48,297/- which has been admitted in full by the Applicant/ Resolution Professional. The Resolution Applicant proposes a sum of Rs. 1,74,54,981 /- to the Financial Creditors to be paid in 2 equated installment with a difference of 30 days in each installment starting from 30th day from the effective date.

b) Operational Creditors (Employees/Workmen)

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

As per the Information Memorandum and List of Creditors of the Corporate Debtor, no claim was received from the Operational Creditors (Employees/Workmen) therefore, the amount proposed by the Resolution Applicant is NIL.

c) Operational Creditor (including statutory dues) As per the Information Memorandum and List of Creditors of the Corporate Debtor, no claim was received from any statutory authority, therefore, the amount proposed by the Resolution Applicant is NIL. 5.2. Term of the Resolution Plan The term of the Resolution Plan will be 60 days from the approval of the Resolution Plan by this Adjudicating Authority and the implementation of the plan will commence from the date when the Adjudicating Authority approves the Resolution Plan. 5.3. The amounts provided for the stakeholders under the Resolution Plan as outlined in Form H is as under: (Amount in Rs. Lakh) Sl. Category Sub - Category Amount Amount Amount Amount No. of of shareholder Claimed Admitted provided provided to sharehold under the the amount er plan claimed (1) (2) (3) (4) (5) (6) (7)

1 Secured (a) Creditors not Nil Nil Nil Nil Financial having a right Creditor to vote under IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

sub-section (2) of Section 21 (b) Other than (a) Nil Nil above Nil Nil (i)who did not Nil vote in favour of Nil Nil Nil the Resolution Plan (ii) who voted in Nil favour of the Nil Nil Nil Resolution Plan

Total[(a)+(b) Nil Nil Nil Nil

2 Unsecure a)Creditors not d having a right to 1,53,48,297 1/,-5 3,48,297 1,74,54,981 1 ,74,54, 981 vote under sub- Financial Creditor section (2) of Section 21 b) Other than (a) above (i)who did not Nil Nil Nil Nil vote in favour of the Resolution Plan (ii) who voted in favour of the Nil Nil Nil Nil Resolution Plan

- Total [(a)+(b)] 1,53,48,297 1,53,48,297 1,74,54,981 1,74,54, 981

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

3 Operation (a)Related Party Nil Nil Nil Nil al of Corporate creditors debtor (b) Other than(a) above: Nil Nil Nil Nil (i) Government Nil Nil Nil Nil (ii)Operational Creditors (Other than workmen and Employees Nil Nil and Nil Nil Government Dues)

Total [(a)+(b)] Nil Nil Nil Nil

4 Other Nil Nil Nil Nil debts and dues 1,53,48,29 1,53,48,29 1,74,54,981 1,74,54, 981 Grand Total

6. The details of compliances made under relevant sections of IBC, 2016 and IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 as stated in the Form-H are extracted below: The compliances of the Resolution Plan is as under:

Section of the Requirement with respect to Clause of Resolution Compliance Code / Resolution Plan Plan (Yes / No) Regulation No.

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

25(2)(h) Whether the Resolution Net worth certificates Yes Applicant meets of SRA the criteria approved by the CoC having regard to the complexity and scale of operations of business of the CD?

Section 29A Whether the Resolution Yes, Affidavit under Yes Applicant is eligible to submit a Section 29A was given resolution plan as per the final by SRA list of Resolution Professional or Order, if any, of the Adjudicating Authority? Section 30(1) Whether the Resolution Yes, Affidavit is Yes Applicant has submitted an annexed with affidavit stating that it is eligible? Resolution Plan application

Section 30(2) Whether the Resolution Plan- Chapter VI of the Yes (a) provides for the payment of Resolution Plan insolvency resolution process costs? (b) provides for the payment to the operational creditors? (c) provides for the payment to the financial creditors who did not vote in favour of the resolution plan? (d) provides for the management of the affairs of the corporate debtor? (e) provides for the implementation and supervision of the resolution plan? (f) contravenes any of the provisions of the law for the time being in force?] IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

Section 30(4) Whether the Resolution Plan Chapter V of Yes (a) is feasible and viable, Resolution Plan and according to the CoC? the Resolution of COC (b) has been approved by the for approval of CoC with 66% voting share? Resolution with 100% is annexed with Application Section 31(1) Whether the Resolution Plan has Chapter X of Yes provisions for its effective Resolution Plan implementation plan, according to the CoC? Regulation 38 Whether the amount due to the Chapter VI of Yes (1) operational creditors under the Resolution Plan resolution plan has been given priority in payment over financial creditors? Regulation Whether the resolution plan Chapter VI of Yes 38(1A) includes a statement as to how it Resolution Plan has dealt with the interests of all stakeholders? Regulation (i) Whether the Resolution Chapter VI of No 38(1B) Applicant or any of its related Resolution Plan parties has failed to implement or contributed to the failure of implementation of any resolution plan approved under the Code. (ii) If so, whether the Resolution Applicant has submitted the statement giving details of such non implementation?] Regulation Whether the Resolution Plan Chapter X & XII of Yes 38(2) provides: Resolution Plan, (a) the term of the plan and its Chapter XI of implementation schedule? Resolution Plan. (b) for the management and Chapter X of control of the business of the Resolution Plan corporate debtor during its term? (c) adequate means for supervising its implementation?

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

Regulation Whether the resolution plan Yes 38(3) demonstrates that – (a) it Chapter V of addresses the cause of default? Resolution Plan. (b) it is feasible and viable? (c) it has provisions for its Chapter X of effective implementation? Resolution Plan. (d) it has provisions for approvals Chapter XII of required and the timeline for the Resolution Plan same? (e) the resolution applicant has the capability to implement the Chapter VI of resolution plan? Resolution Plan Regulation Whether the RP has filed Chapter XIV of Yes 39(2) applications in respect of Resolution Plan transactions observed, found or determined by him? Regulation Provide details of performance Yes 39(4) security received, as referred to in sub-regulation (4A) of regulation 36B.]

6.2. The Applicant submits that the successful resolution applicant has submitted an affidavit dated 08.09.2023 in regard to the eligibility under section 29A of the Code, as required by Regulation 39(1)(a) of the CIRP Regulations. An undertaking has also been submitted by the successful Resolution Applicant, as mandated in terms of Regulation 39(1)(c) of the CIRP Regulations.Further, the Applicant/ RP has also submitted an affidavit dated 23.03.2024 stating that based on the aforesaid affidavit submitted by the SRA as well as on the basis of due diligence conducted by the Applicant/ RP, the SRA has been found to be eligible to submit the Resolution Plan.

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

6.3. It is further stated that the Resolution Plan which has been submitted by Resolution Applicant complies with the Section 32A of the Code regarding the liability of prior offences and pending litigation in the present case.Further there will be change in management as new directors will be appointed who will be accountable for the affairs of the company.

6.4. With respect to Provident Fund Dues, it has been categorically mentioned by the Applicant/ RP that he has not received any claim with respect to Provident Fund dues. As no PF liability on the date of initiation of CIRP was placed before the Resolution Professional, no further direction in this regard is called for. On this issue, we refer to the decision of Hon’ble NCLAT in the matter of Employees Provident Fund Organization Vs. Rajat Mukherjee Liquidator of Enviiro Bulk Handling System Private Limited in Comp App.(AT) (Ins) No. 804 of 2024 in IA No. 2868 of 2024 dated 10.05.2024 where in is has been held :

“When the entire claim which was filed under 7A and 7Q was paid to the appellant, we fail to see any error in the order of the Adjudicating Authority in rejecting the application. It has been noticed by the Adjudicating Authority that claim under Section 14B was assessed by an order dated 16.6.2021 passed after initiation of CIRP proceedings. Adjudicating Authority has noted the judgment of this Tribunal in Regional Provident Fund Commissioner, Vatwa, Employees Provident Fund Organisation vs. Manish Kumar Bhagat in Company Appeal (AT) (Ins) No. 808 of 2022 which has rightly

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

been relied upon for not accepting the claim which was subsequent to the initiation of CIRP.” [Emphasis supplied] 6.5. With respect to PUFE Transactions pertaining to the Corporate Debtor, the Applicant /RP has provided details of the IAs filed by him under Section 43,45 and 66 of the Code. In regard to treatment for the PUFE applications, it is stated in the resolution Plan that the Resolution Applicant will continue to prosecute the application after approval of the Resolution Plan and the proceeds, if any, from such proceedings shall vest with the Corporate debtor/ Resolution Applicant.

7. Compliance with Section 30(2) of the Code: Clauses Requirement How dealt with in the Plan of Sec 30(2) (a) Provides for the payment of Yes, Chapter VI of the Resolution Insolvency Resolution Process Plan, Cost. It is mentioned that the entire CIRP cost shall be paid in priority to any other creditors of CD. Further RA proposes the unpaid CIRPcost, as on the date of resolution plan in priority to any other creditor within a period of 30 days of the effective date. It is provided that CIRP cost shall be paid in full. The plan provides for the payment of the entire CIRP cost within 30 days from the effective date before making payment to any other creditors. (b) provides for the payment of the Yes, Chapter VI of the Resolution debts of operational creditors in Plan. such manner as may be specified There are no operational creditors. The Resolution plan adequately IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

by the Board which shall not be deals with the interest of all less than: stakeholders. (i) the amount to be paid to such There has been reference/statement creditors in the event of a in terms of Section 30(2)(b) of the IB liquidation of the corporate Code and Regulation 38(1)(a) of the debtor under section 53; or CIRP Regulations. (ii) the amount that would have been paid to such creditors, if the amount to be distributed under the resolution plan had been distributed under the resolution plan had been distributed in accordance with the order of priority in sub-section (1) of section53; Whichever is higher, and provides for the payment of the debts of financial creditors, who do not vote in favour of the resolution plan, in such a manner as may be specified by the board, which shall not be less than the amount to be paid to such creditors in accordance with the sub-section (1) of section 53 in the event of a liquidation of the corporate debtor. (c) Management of the affairs of the Yes, Chapter VI of the Resolution Corporate Debtor after approval Plan of the Resolution Plan. (d) Implementation and Supervision Yes, CHAPTER XII– Indicative of Resolution Plan. Timeline For Implementation (e) Plan does not contravene any of Yes the provisions of the law for the time being in force. (f) Conforms to such other Yes, Chapter VI of the requirements as may be specified Resolution Plan by the Board.

8. Details of Resolution Plan

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

The Resolution Plan Provides for payment as per the table appended hereinafter:

S.No Payment Plan Proposed Amount proposed Terms of Amount in to be paid in INR payment %

1. CIRP Cost 100% of RP proposed CIRP Within 30 days unpaid Cost of from the CIRP Cost Rs.38,79,649. Effective date. However, RP has not informed about the unpaid cost, if any 2. Payment to FC Amount of Rs. 1,74,54,941/- To be paid in 2 (unsecured) to claim Equated Ambrane India Admitted by installment Private the with a difference Limited Financial of 30 days in Creditor each installment along with starting from interest 9% 30th day from on the the effective admitted date amount till 30.09.2023 3. To meet the working Rs.1,00,000 /-capital requirement to be infused upfront by the RA. 4. Towards the other Rs.1,00,000 /-unforeseen contingent liability arising in future or during implementation of plan. Rs.2,13,34,590/- TOTAL

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

9. Scheme of Restructuring.

The resolution Plan states that the restructuring shall take place in the following manner:

a) On the date of Upfront Equity Infusion, the entire existing shareholding of the CD shall stand transferred in the favor of the Resolution Applicant or its nominees at a value of INR10. b) Entire share capital of CD will stand transferred to the Resolution Applicant or its nominees at a value of INR 10/-. It is classified that deposit of the consideration for purchase of shares and issuance of cheques to the existing shareholder is sufficient for transfer of shares in favor of the RA irrespective of whether the shareholders encash the said cheque or not and handover/transfer share or not the said amount of Rs. 10, will be deposited before the NCLT in DD or in any manner as directed by the NCLT. c) There shall be no stamp duty etc. on the issuance of the fresh shares in lieu of the shares cancelled of the erstwhile shareholders. d) The Books of Accounts will be re-casted on the Effective Date giving effect to this Resolution Plan. e) Simultaneous to the transfer of the existing shareholding, and infusion of funds by the Resolution Applicant, CD shall issue 10,000 Equity Shares (fully paid up of face value INR 10/- each) aggregating to INR 1,00,000/- Thereafter the funds will be infused in the CD by way of unsecured loans from the RA. f) In case such restructuring requires increase in authorized share capital of the CD and consequent amendment of the Memorandum of Association of the CD, such increase and amendment shall take place as part of the Resolution Plan. The authorized share capital of the CD shall be without any further act, instrument or deed by the CD and without any liability for payment of any fees or stamp duty in respect of such increase. 9.2. Sources of Funds: IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

It is stated that the entire contribution from the Resolution Applicant shall be funded via own sources to make the payments to creditors as proposed in this Resolution Plan which is demonstrated on internal Page No. 59 of the Resolution Plan. The Successful Resolution Applicant has submitted EMD/ Performance Bank Guarantee. The Net worth of “Successful Resolution Applicant” as on 06.05.2023 is Rs. 19,08,65,007 /- to satisfy the sources of funds for smooth implementation of the Plan when approved by this Adjudicating Authority.

9.3. The Resolution Plan shall be implemented in the following manner as per the indicative timelines which is as follows:

Sl Activity Estimated Timelines No.

1. Submission of proposed Resolution Plan 20.10.2023 by the Resolution Applicant 2. Date of Approval of Resolution Plan by T (effective Date) Adjudicating Authority 3. Formation of monitoring committee T+10 4. Extinguishment of promoters T+15 shareholding 5. Transfer of Share Capital in favour of Within T + 20 days resolution Applicant 6. Issue of fresh Equity Shares to the RA Within T + 25 days 7. Payment of CIRP Cost Within T + 30 days 8. 1st tranch fund infusion (50% of Rs. Within T + 30 days 1,74,57,941/- 9. 2nd tranch fund infusion (Remaining Within T+60 days IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

50% of Rs. 1,74,57,941/- 10. Cut off date T+60

10. The details of the management and control of the corporate debtor as provided in the Resolution Plan is:

a. It is stated that in order to ensure that the Resolution Plan is implemented, an appropriate monitoring committee shall be appointed within 10 business Days of the Effective Date. b. The Resolution Applicant shall constitute the monitoring committee, which shall comprise of (1) the Resolution Applicant and (2) one person designated from the sole Financial Creditor of the COC and (3) the existing Resolution Professional, who will monitor the implementation of the plan after the Effective Date for the tenure of the Resolution Plan. c. The monitoring committee, so appointed, shall have inter alia the following responsibilities: Monitoring the implementation of this Resolution Plan and will also issue a certificate for the successful completion of the Resolution Plan after the plan being implemented

10.2. It is proposed that the Management and control of the Corporate Debtor shall vest with the new management as appointed by the Resolution Applicant. The Resolution Applicant proposes to appoint new directors on the Board who will be accountable for for day to day affairs and management of the Corporate Debtor

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

11. As can be seen from the Clause-7 of the certificate given by the RP on prescribed form viz. Form-H, the SRA has proposed to pay the full amount as admitted by the RP to the different stakeholders.

12. The evidence of receipt of performance security of Rs. 21,33,459.00 (i.e. 10% of total resolution plan value)) along with an earnest money deposit (EMD) of Rs. 2,00,000 /-deposited by the SRA as required under regulation 36B (4A) is also placed on record as Annexure A-15 of the application. The RP has issued the Letter of Intent to the Successful Resolution Applicant on 16.12.2023.

13. In the Resolution plan, the Resolution Applicant has sought certain reliefs and concessions which fall under the jurisdiction of different Government Authorities, and/or are subject to the provisions of different laws for the time being in force. In this connection, it is made clear that the amount payable by the SRA in terms of the plan to different creditors, stakeholders, and to keep the Corporate Debtor as a going concern is not a subject matter of any condition, assumptions, relief/concessions and/or qualification. It also needs to be underlined that the provisions of Section 31(4) of IBC, 2016 mandates the Resolution Applicant to obtain the necessary approval required under any law for the time being in force within a period of one year from the date of approval of the resolution plan by the Adjudicating Authority under Section 31 of the IBC, 2016 in terms of the provisions of Section 14 of the Code even during the period of CIRP, no default in payment of current dues is a IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

precondition for continuation of the License, Permit, Registration and similar rights. Thus, even during the moratorium period, the facilities mentioned above are made available to the CD only when there is no default in payment of the current dues, on approval of the resolution plan, the SRA/CD cannot be put on a better footing by exempting it from paying its legitimate dues under the law.

13.2. Furthermore, the Code provides for consideration of the claims, by the IRP/RP in terms of the provisions of Section 18(b) and Section 25(b) read with the relevant regulations.

13.3. The Code also provides for preparation of an Information Memorandum in terms of the provisions of Regulation 36(2) of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which contains, inter alia, a list of creditors along with the amounts claimed by them. Regulation 36(1) of the regulations (ibid), provides for submission of the said Information Memorandum to each member of the COC. Regulation 36A provides for invitation for expression of interest and Regulation 36B provides for a request for a Resolution Plan. It is with reference to the Information Memorandum and Evaluation Matrix that the RP issues a Request for Resolution Plan. The Request for Resolution Plan details each step in the process and the manner and purposes of interaction between the Resolution Professional and the Prospective Resolution Applicant. The Resolution Plan submitted after consideration of the IM, EM and the RFRP is then examined by the Committee of Creditors. Even then, it needs to satisfy the requirements of IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

Regulations 37 and 38 of the extant regulations and only then it can be approved by the COC in terms of the provisions of Regulation 39 of the aforementioned regulations. After such approval, the Plan effectively becomes a contract entered into between CD represented through RP, SRA, the creditors of the CD, and other stakeholders and is binding on all of them. Section 31(1) of IBC, 2016, thus, takes care of most of the reliefs/concessions/waivers which are required by the Resolution Applicant. Furthermore, Section 32A of the Code provides for cessation of the liability for offences committed by the CD prior to initiation of the CIRP subject to the conditions laid down in the said section.

13.4. In this context a reference is made to the decision of Hon’ble NCLAT in Worldfa Exports Pvt. Ltd Vs. Vivek Raheja and Anr. [Company Appeal (AT) (Insolvency) No. 827 of 2024 & I.A. No. 2994 of 2024] dated 30.04.2024 wherein a challenge was laid against the following observation of the NCLT:

“16. However, the resolution plan shall not be construed as waiver to any statutory obligations/liabilities arising out of the approved resolution plan and the same shall be dealt in accordance with the appropriate authorities concerned as per relevant laws. We are of the considered view that if any waiver is sought in the resolution plan, the same shall be subject to approval by the concerned authorities. The same view has been held by the Hon’ble Supreme Court in Ghanshyam Mishra and Sons Private Limited vs. Edelweiss Asset Reconstruction Company Limited and Embassy Property Development case (supra).” The Hon’ble NCLAT, however, dismissed the Appeal with the following observation:

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

“Adjudicating Authority has already referred to the Judgment of the Hon’ble Supreme Court in the matter of `Ghanshyam Mishra & Sons Private Limited’ Vs. `Edelweiss Asset Reconstruction Company Limited’, in Civil Appeal No. 8129 of 2019, which clearly laid down that all claims which have not been dealt in the Resolution Plan does not survive after the approval of Resolution Plan. 6. Insofar as statutory waivers and concessions, Adjudicating Authority has rightly observed that SRA to file appropriate necessary application before the necessary Forum/Authority in order to avail the relief and the concession. 7. The Resolution Plan having been approved it is always open for the Applicant to make an appropriate application before the Statutory Authority for grant of such relief as permissible after approval of the Resolution Plan. 8. It goes without saying that all past liabilities which are not dealt with in the Resolution Plan stand extinguished by view of the Judgment of the Hon’ble Supreme Court in `Ghanshyam Mishra & Sons Private Limited’ (Supra) which is a well settled law.”

14. In sum and substance, the SRA/CD would be entitled to no other relief/concession/waiver from this Adjudicating Authority except those available to it, as per the provisions of Section 31(1) and 32A of IBC, 2016. The SRA is, however, at liberty to approach the relevant authorities, who would consider these claims as per the provisions of the relevant law, in an expeditious manner.

15. In the sequel to the above, we are inclined to approve the Resolution Plan as approved/recommended by the CoC as placed by the Applicant before IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

this Adjudicating Authority. We, therefore, allow the present Application and approve the COC-approved Resolution Plan as placed before us by the Applicant/RP with the following directions: - (i) The approved Resolution Plan shall become effective from the date of passing of this Order and shall be implemented strictly as per the term of the plan and implementation schedule given in the Plan;

(ii) The SRA/CD would be entitled to no other reliefs/ concessions/waivers except those are available/permissible to it as per the provisions of Section 31(1) and 32A of IBC, 2016. The SRA is at liberty to approach the relevant authorities who would consider these claims as per the provisions of the relevant law in an expeditious manner.

(iii) The Monitoring Committee as provided in the Resolution Plan shall be set up by the Applicant/RP within 07 days of passing of this Order, which in turn, shall take all necessary steps for time bound implementation of the Resolution Plan as per approval.

(iv) The order of the moratorium in respect to the corporate debtor passed by this Adjudicating Authority under Section 14 of the IBC, 2016 shall cease to have effect from the date of passing of this Order; and (v) The Resolution Professional shall forward all the records relating to the conduct of the CIRP and the Resolution Plan to the IBBI for its record and database.

16. The Court Officer and Resolution Professional (RP) shall forthwith make available/send a copy of this Order to the CoC and the Successful Resolution Applicant (SRA) for immediate necessary compliance.

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.

17. A copy of this order shall also be sent by the Court Officer and Applicant to the IBBI for their records.

-sd- -sd- (SUBRATA KUMAR DASH) (ASHOK KUMAR BHARDWAJ) MEMBER (T) MEMBER (J)

IA. No. 03/2024 in C.P. (IB)-2607/(PB)/2019 Ambrane India Pvt. Ltd. Versus MP Promoters Pvt. Ltd.